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Innovation in Compliance

Navigating an Increasingly Complex Sanctions Landscape: Building an Effective Sanctions Compliance Program

Welcome to the podcast series: In Conversation with K2 Intelligence FIN: Navigating an Increasingly Complex Sanctions Landscape. This series is sponsored by K2 Intelligence FIN. This week I will visit with  Adam Frey, Managing Director at Intelligence FIN and Eric Lorber, Vice President at Intelligence FIN.

Over the week, we will review the current sanctions landscape, discuss how to build a sanctions compliance program, walk listeners through what happens when you discover a sanctions breach or potential breach, consider new sanctions exposure and conclude with a look in that veiled land of the future by considering issues on the horizon. In this Episode 2, I am joined by Adam Frey to learn about how to build an effective sanctions compliance program.

We conclude with a few thoughts on the constant pressure for cost-cutting in the compliance function, which has been made more acute during the time of Covid-19. Frey noted that it “ is a consistent pressure. But I think it’s important to emphasize organizations really have to resist the urge to, to cut costs.” The reason is the cost of a compliance failure is so high and the regulators have said that all businesses must remain ever vigilant.  The idea of cutting corners now in an attempt to reduce costs could really end up adding costs down the line in terms of fines and penalties down the road.
Please join us tomorrow where Eric Lorber returns to discuss the actions you should take if you have sanctions violation or even a potential. While it depends somewhat on the size of the organization.
Resources
For more information on K2 Intelligence FIN’s Sanctions Risk Advisory Services, click here.
For more information on Navigating the Sanctions Minefield: What Every Global Business Should Know, click here.

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Compliance and Coronavirus

Ryan Schonfeld on IT Security Issues in the Age of Covid-19


Welcome to the newest addition to the Compliance Podcast Network, Compliance and Coronavirus. In this episode, I visit with Ryan Schonfeld, founder of RAS Consulting and Investigations. We consider various issues relating to IT security brought on or amplified by Covid-19. They include some of the top questions Schonfeld is getting from clients during Covid-19; why due diligence and investigative services are even more important now; how IT security and risk profiles have changed in the era of Covid-19 and WFH; how have risk profiles around physical security changed; and as we move into phased reopening across the country, what are some of the key IT security issues to consider. For more information on RAS Consulting and Investigations, check out their website here.

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Innovation in Compliance

Dealing with Bumps in the Night with James Green


Director of Advisory Services at SAI Global, James Green, is this week’s guest on the Innovation In Compliance podcast. James’ role involves helping clients manage atypical risk concerns or situations, including business continuity, vendor risk, pandemic, workplace violence, and active shooters. He chats with Tom Fox about his company’s 360° view of risk management and how to survive risks that you never saw coming.

 
Compliance vs Operational Risk Management
James gives his perspective on the difference between compliance and operational risk management. Compliance, he says, is ensuring that you’re adhering to your own standards, policies, and regulatory requirements. Operational risk management, on the other hand, is mitigating any risk to the company, no matter where it originates. Hurricane Harvey is a classic example of checking all the compliance and risk management boxes, but failing to mitigate the actual risk. Tom comments that compliance and risk management are much closer than just complementary: a combined approach helps a business create a more robust strategy for overall risk management. 
360° View of Risk Management
SAI Global advocates a 360° view of risk management; risk and compliance need to be seen holistically. “We believe a company needs to be assessing risk in totality wherever it comes from,” James says. “And it doesn’t matter where it comes from, because the goal is to increase your organization’s resilience, right. That is really the goal of all of our collective functions, is that when there’s a bump in the night, we can manage through it successfully, legally, ethically, to the satisfaction of our stakeholders.”
When Things Go Bump In The Night
Tom comments on SAI Global’s real-time risk management approach. He asks James how it allows an organization to be more agile and responsive to market conditions as they come up. James responds that while compliance and risk professionals are great at mitigating issues that just happened, they need to also be aware that there will always be unknown and unanticipated issues. “…The problem is in our world, there’s always an unknown that’s coming up. Right now we’re living through COVID-19 which was unknown to a lot of us,” James points out. “There’s always something that’s gonna happen. There’s always another bump in the night. So you can’t be planning based on what happened in the past. You need to be agile. You need to be nimble.” He gives tips on how to determine if a risk is strategically acceptable, and the role risk management should play in the corporation. 
COVID-19 and Supply Chain
They originally saw COVID-19 as a supply chain issue, James says, and started advising their clients about it in January. It became much more than that, he remarks. “Supply chain really needs to be embedded in your risk model… because it can damage what your suppliers and vendors do, it can damage your brand to your customers.” He shares useful COVID-19 resources that his company has made freely available to the public.
Resources
SAIGlobal.com
COVID-19 Resources
James Green on LinkedIn | Twitter

Categories
Daily Compliance News

July 1, 2020-the Wearing Masks Will Save the Economy edition


In today’s edition of Daily Compliance News:

  • Adidas head of HR loses trust of employees. (NYT)
  • SEC closed bribery investigations into Usana Health Sciences Inc.’s operations in China. (WSJ)
  • Supreme Court turns down FCPA case. (Rueuters)
  • Wearing masks will save US GDP 5%. (WaPo)
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Daily Compliance News

June 30, 2020-the Diversity is Good for Business edition

 
In today’s edition of Daily Compliance News:

  • Diversity is good for business. (Houston Chronicle)
  • Germany moves to revamp audit firm oversight. (WSJ)
  • Is corruption inevitable in the extraction industry? (Brookings)
  • Business Roundtable expects Coronavirus impacts into 2021. (WaPo)
Categories
The Affiliated Monitors Expert Podcast

How Does a Company Assess its Culture


In this episode I visit with Eric Feldman on how a company can begin to assess its own culture. We began by considering whether a company should try and perform a self-assessment of its own culture or whether it should bring in a truly independent professional to do the assessment. Feldman said that both are valid but each has a different focus. The self-assessment is really more akin to ongoing monitoring. In this scenario, a company has the responsibility to monitor its own workforce and culture literally on a day-to-day basis. He stated, “That ongoing monitoring and oversight is critical to being able to manage what is a very normal ebb and flow of the culture in an organization. Cultures are dependent on people and people come and go in companies and that can influence the culture. The market and financial stress can influence the culture and what happens within a company.” These are all things a company should track and monitor.
The bottom line is that it is helpful to take the temperature of your employees internally by doing regular monitoring of your company to understand its culture and what needs to be done. However, employees are not going to be as honest and forthcoming with someone in their company as they would be with an independent third-party. This is because employees are almost always afraid of the potential blow back from superiors. Employees will be much more reserved with people that they know or people in their own company so it can be much more powerful and much more effective for an independent third party performing cultural assessment work.

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31 Days to More Effective Compliance Programs

Miranda and internal investigations: What rights does an employee retain?


Must an investigator warn an employee that concealing information from company lawyers conducting an internal FCPA investigation could be a federal crime? Even if the company attorneys provided the now standard corporate attorney Upjohn warning? Does a company attorney asking questions morph into a de facto federal agent during an internal company investigation regarding alleged FCPA violations and is the attorney thereby required to provide a Miranda warning to employees during said investigation?
Employees who are subject to being interviewed or otherwise required to cooperate in an internal investigation may find themselves on the sharp horns of a dilemma requiring either (1) cooperating with the internal investigation or (2) losing their jobs for failure to cooperate by providing documents, testimony or other evidence. Many U.S. businesses mandate full employee cooperation with internal investigations or those handled by outside counsel on behalf of a corporation. These requirements can exert a coercive force, “often inducing employees to act contrary to their personal legal interests in favor of candidly disclosing wrongdoing to corporate counsel.” Moreover, such a corporate policy may permit a company to claim to the government a spirit of cooperation in the hopes of avoiding prosecution in addition to increasing the chances of earning meaningful credit under the U.S. Sentencing Guidelines or the FCPA Corporate Enforcement Policy.
Three key takeaways:

  1. Make sure you provide an Upjohn warning.
  2. If an employee demands counsel to represent them during an internal investigation, who bears the cost?
  3. Always check state law requirements around internal investigations.
Categories
Innovation in Compliance

Navigating an Increasingly Complex Sanctions Landscape: The Current Landscape


Welcome to this special podcast series; In Conversation with K2 Intelligence FIN: Navigating an Increasingly Complex Sanctions Landscape. This series is sponsored by K2 Intelligence FIN. This week I will visit with  Adam Frey, Managing Director at Intelligence FIN and Eric Lorber, Vice President at Intelligence FIN.
Frey is a key member of the firm’s independent consultant team, at the direction of federal, state, and/or international regulators, he works to monitor and assess global financial institutions’ compliance with AML and OFAC enforcement actions and related consent orders. Adam helps lead K2 Intelligence FIN’s reviews of the institutions’ BSA/AML and sanctions compliance programs, policies, and procedures. Lorber advises global financial institutions on issues related to sanctions and anti-money laundering/combating the financing of terrorism compliance. Prior to re-joining FIN, Eric was a senior advisor to the Under Secretary for Terrorism and Financial Intelligence at the United States Department of the Treasury, where he provided strategic guidance on U.S. sanctions and AML/CFT policies. Earlier in his career, he was an attorney at Gibson, Dunn & Crutcher, where he advised clients in the areas of international trade regulation, compliance, and anti-corruption. He is also the senior director of the Center of Economic and Financial Power at the Foundation for Defense of Democracies.
Over the week, we will review the current sanctions landscape, discuss how to build a sanctions compliance program, walk listeners through what happens when you discover a sanctions breach or potential breach, consider new sanctions exposure and conclude with a look in that veiled land of the future by considering issues on the horizon. In this Episode 1, I am joined by Eric Lorber to review the current sanctions landscape.
The bottom line is that sanctions are here to stay and every business needs to understand their impact to your company.
Please join us tomorrow where we discuss building a sanctions compliance program with Adam Frey.
Resources
For more information on K2 Intelligence FIN’s Sanctions Risk Advisory Services, click here.
For more information on Navigating the Sanctions Minefield: What Every Global Business Should Know, click here.

Categories
FCPA Compliance Report

Louis Perold on the State of Compliance In South Africa


In the Episode, I am joined by Louis Perold, founder of Citadel Compliance. Perold has with more than 20 years’ experience in legal and compliance across various industries including financial, oil and gas, mining, retail and manufacturing. He has successfully transformed and operationalized global ethics and compliance risk management programs from concepts to real-world practices and infrastructures that work. He is a strategic business partner and team-focused leader experienced in delivering proactive solutions that help protect organizations from compliance failures, liabilities, and reputational damage. He is also a well-respected global educator, advocate, and influencer on ethics and compliance risk management effectiveness and best practices.
We visit about his founding of Citadel Compliance, the current state of ABC compliance in South Africa and how Covid-19 has impacted business in South Africa. Some of the highlights include:

  • What does Perold hope to bring to the market through your own compliance consulting firm, Citadel Compliance?
  • How does Perold assess the current state of anti-corruption compliance in South Africa?
  • Have internationally focused South African companies come to embrace ABC compliance as a way of doing business?
  • For companies who want to do business in South Africa, what are some of the key issues from the compliance perspective?
  • What are some of the ways coronavirus has impacted compliance in South Africa?

 Resources
For more information on Perold, check out the Citadel Consulting website here.

Categories
Daily Compliance News

June 29, 2020-the Second Class Travelers edition


In today’s edition of Daily Compliance News:

  • Cracks in the heart of Germany Inc? (CNN)
  • US travelers banned in EU. (NYT)
  • Middle management more important in compliance. (WSJ)
  • Hollywood throws in the towel on the summer season. (WaPo)